• Anadarko Petroleum Corp., Houston, (NYSE: APC) plans to sell a portion of its interest in the K2 unit in the Gulf of Mexico to two undisclosed parties for $1.2 billion. The assets include a 23.2% working interest in six wells in the unit. Gross production is 37,100 BOE per day. Anadarko will remain operator with a 41.8% working interest.

Anadarko chairman, president and chief executive Jim Hackett says, "This transaction allows us to both diversify our risk profile and retain a meaningful working interest as the operator in the unit. We believe there is outstanding upside potential in this unit and are working with our partners to finalize plans to enhance the recovery of oil from this large reservoir."

Hackett expects the deal will help reduce the company's debt quickly and help maintain a solid investment-grade credit rating. UBS and Credit Suisse are financial advisors to Anadarko, and Scotia Waterous marketed the assets. The deal is expected to close in this quarter.



• Constellation Energy Partners LLC, Baltimore, (NYSE: CEP) plans to acquire certain coalbed-methane properties from EnergyQuest Resources LP, a Quantum Energy Partners portfolio company, for $115 million.

The properties include 550 producing wells on 96,000 gross acres in the Cherokee Basin in Kansas and Oklahoma. Bullseye Operating LLC is operator on a portion of the assets. The properties also feature more than 500 miles of gathering systems.

Net production is 7.9 million cu. ft. of gas equivalent per day (75% operated). Proved reserves are approximately 49 billion cu. ft. Constellation will fund the deal with proceeds from an equity private placement and from its revolving credit facility.

Simmons & Company International and Griffis & Associates LLC are financial advisors to EnergyQuest. The deal is expected to close this month.



• EV Energy Partners LP, Houston, (Nasdaq: EVEP) plans to acquire properties in Monroe Field of northern Louisiana from an institutional partnership managed by EnerVest Management Partners Ltd., Houston, for $96 million.

The assets include a 95% average net revenue interest in more than 2,800 wells in Union, Morehouse and Ouachita parishes. Net production is 7.6 million cu. ft. of gas per day. Proved reserves are 65.4 billion cu. ft. of gas equivalent (99% proved developed producing).

EV Energy will operate the assets, which feature third-party transportation and marketing.

EV Energy chairman and chief executive John Walker says, "The acquisition of these properties will create excellent synergies with our existing Monroe Field assets. As with our recently completed acquisitions, these properties fit well with EVEP's asset base and we expect the acquisition to be accretive to distributable cash flow per unit."

The deal is expected to close this month.



• Callon Petroleum Co., Natchez, Miss., (NYSE: CPE) plans to acquire an 80% working interest in Entrada Field in the Gulf of Mexico from BP Exploration & Production Co., a subsidiary of BP Plc, London, (NYSE: BP) for $190 million in cash.

The interests involve Garden Banks blocks 738, 782, 785, 826 and 827. Pro forma, Callon will own a 100% working interest in the field and will be operator.

Net proved reserves are approximately 13.7 million bbl. of oil and 68.1 billion cu. ft. of gas, and net probable reserves are 13.7 million bbl. and 32.9 billion cu. ft. for total proved and probable net reserves of approximately 44.2 million BOE.

Callon has received a seven-year, $200-million revolving credit facility from Merrill Lynch Capital Corp. to fund the acquisition and a portion of the related development costs.

The deal is expected to close in May.



• Range Resources Corp., Fort Worth, Texas, (NYSE: RRC) has sold its Austin Chalk properties in central Texas to an undisclosed private company for $82 million. The properties were assets of Stroud Energy Inc., which Range bought in 2006, and were noncore to Range. Production is approximately 16 million cu. ft. of gas per day.

Range president John H. Pinkerton says, "Importantly, we have reinvested a portion of the sales proceeds in core areas where we are having terrific drilling results. We are also considering the sale of our Gulf of Mexico properties. These actions are in lock-step with our strategy of focusing on long-lived, onshore properties in our core areas."

Separately, Range has acquired the minority interest in its northern Oklahoma shallow-oil play from an undisclosed seller for $30.5 million. The assets include 400 drilling areas with 67 proven. Proved reserves are 15.5 billion cu. ft. of gas equivalent.

Range funded the deal with proceeds from the Austin Chalk sale.



• Denbury Resources Inc., Dallas, (NYSE: DNR) plans to acquired the Seabreeze complex in Texas from Anadarko Petroleum Corp., The Woodlands, Texas, (NYSE: APC) for $42 million. The assets include five significant fields and a few smaller fields in the Houston area. Production is 750 BOE per day. Proved reserves are up to approximately 750,000 BOE.



• Maverick Oil and Gas Inc., Dallas, (OTCBB: MVOG) plans to sell its interest in Barnett shale properties in North Texas to an undisclosed buyer for $22.5 million to focus on its Fayetteville shale properties. The assets involve more than 9,700 gross acres (3,500 net) in Wise County. The majority of assets are operated by Devon Energy Corp. Six wells are drilled and six more are planned.

Approximately $20 million of the proceeds will be used to pay a portion of the company's debt and the remainder will be used for capital programs and working capital. Maverick chief executive James A. Watt, "We will now be seeking new properties with near-term cash flow to support our operations and complement our long-term resource play in the Fayetteville shale of Woodruff County, Arkansas."

The deal is expected to close this month.



• The Exploration Co. (TXCO), San Antonio, (Nasdaq: TXCO) plans to acquire privately held Output Exploration LLC, Houston, for $91.6 million in cash and $4 million in stock in a deal valued at $95.6 million. TXCO will fund the cash portion from an expanded four-year senior credit facility underwritten by BMO Capital Markets and with Bank of Montreal as administrative agent.

The assets involve 31,000 net leasehold acres (24% undeveloped), with 20,000 net acres in the Fort Trinidad Field in Houston and Madison counties, on the Texas Gulf Coast, and 11,000 net acres in 16 counties in western Oklahoma, centered on the Rush Springs Field in the Anadarko Basin.

Production is approximately 8.4 million cu. ft. of gas equivalent per day. Proved reserves are 40 billion cu. ft. equivalent (62% gas), and probable and possible reserves total 51 billion equivalent. Pro forma, TXCO will have 730,172 net acres, with net production of 21.8 million cu. ft. equivalent per day. Proved reserves will be 80 billion equivalent. Output's properties in California's Sacramento Basin will be sold before closing.

TXCO chairman, president and chief executive James E. Sigmon says, "It is a good fit because the core of the output properties is in the East Texas Fort Trinidad Field, an area that is prospective for similar plays that we know very well in our Maverick Basin area, such as the Glen Rose, Buda, Austin Chalk and Eagleford/Woodbine formations."

BMO Capital Markets is financial advisor to TXCO.



• Integrys Energy Group Inc., which has been formed from the merger of utilities WPS Resources Corp. and Peoples Energy Corp., has retained JP Morgan Securities Inc. to divest its Houston-based E&P subsidiary, Peoples Energy Production Co.

The E&P has 394 operated wells and 359 nonoperated wells onshore the Texas and Louisiana Gulf Coast, in Oklahoma, Arkansas, Colorado, New Mexico and Wyoming. Total proved reserves are 233 billion cu. ft. of gas equivalent as of September 2006.



• Petroleum Development Corp., Bridgeport, W. Va., (Nasdaq: PETD) has acquired assets in Colorado's DJ Basin from an undisclosed seller for $11.8 million. The assets include 28 producing wells and associated undeveloped land in the Wattenberg Field. Net production is approximately 520,000 cu. ft. of gas and 25 bbl. of oil for a total 668,000 cu. ft. of gas equivalent per day. Proved reserves are 19.1 billion cu. ft. equivalent, and probable reserves are 7.5 billion equivalent.



• Petro Resources Corp., Houston, (Amex: PRC) has acquired an interest in 15 fields in the Williston Basin in North Dakota from an undisclosed private company for $10 million in cash and approximately $10.8 million in stock. The assets consist of a 43% working interest in approximately 15,000 acres and 150 wells with current net production of approximately 260 bbl. of oil per day. Net reserves are approximately 10.4 million bbl. of oil. The seller will remain the operator.

Petro Resources partially funded the cash portion with a $75-million credit facility arranged by Petrobridge Investment Management LLC. Merrill Lynch was financial advisor to Petro Resources and UCX Western LLC facilitated the transaction on behalf of Petro Resources.



• Goodrich Petroleum Corp., Houston, (NYSE: GDP) plans to acquire rights on approximately 16,800 gross acres (8,380 net) in the Angelina River play in Texas from undisclosed sellers. The assets include a 60% working interest in Nacogdoches and Angelina counties and increase the company's position in the play to approximately 68,675 gross acres (29,465 net) and in the overall Cotton Valley trend to approximately 177,230 gross acres (111,650 net).



• Venoco Inc., Denver, (NYSE: VQ) has acquired properties in California in three acquisitions from undisclosed sellers for $24 million. The assets are in the Sacramento Basin, one of the company's core operating bases. Net proved reserves were 19 billion cu. ft. of gas with 10 billion cu. ft. proved producing.

Venoco president Bill Schneider says, "The majority of the reserves were small interests in properties we already operate; the balance were in proximity to our existing operations. Since we are already the operator, we are able to add reserves at a good price, without incurring incremental overhead."





• Palo Duro Operating (U.S.) Inc., a subsidiary of Centillion Industries Inc., Calgary, (Toronto Venture: CID-H) plans to acquire a 27% working interest in approximately 375,000 net acres in the Palo Duro Basin, Texas, from Bankers Petroleum Ltd., Calgary, (Toronto, London: BNK) for US$19.5 million, of which a minimum US$15 million will be in cash. Bankers will remain as operator. The deal is expected to close by May 29.



• Bow Valley Alaska Corp., a subsidiary of Bow Valley Energy Ltd., Calgary, (Toronto: BVX) and has acquired a 20% working interest in 126,990 gross acres of mineral rights on the North Slope of Alaska from a partnership led by J. Andrew Bachner, Keith C. Forsgren and David G. Feddersen for an undisclosed cash price.

Bow Valley's partners-Alaska Venture Capital Group LLC, Anchorage, and its operating subsidiary Brooks Range Petroleum Corp.; TG World Energy Inc., Calgary; and Ramshorn Investments Inc., a subsidiary of Nabors Drilling USA, which is a subsidiary of Nabors Industries Inc., Houston, (NYSE: NBR)-acquired the rest of the acreage.

The position includes 5,115 acres in the Gwydyr Bay area, 11,472 in the Colville Delta area, 96,000 in the Point Thomson area and 14,403 in the Camden Bay area. Bachner will maintain an undisclosed overriding royalty interest in the acreage.

Bow Valley president and chief executive R.G. Moffat says, "The acquisition of these exploration leases adds considerably to Bow Valley's prospect inventory and ability to continue on a multi-well, multi-year exploration program."

With this and leases from an October areawide sale, the partners will hold approximately 307,000 gross acres.

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